Adapt to digital or perish, airline leaders warn

Attendees at this week’s Aviation Festival in London received strong advice from fellow business leaders to sharpen up not only their digital platforms but also their data management infrastructure to guarantee long-term survival.

As Emirates president Sir Tim Clark explained in the opening session:

“It is the one big chance that we have to get our business…into something that is truly engaged in the way the 21st century is moving. [And it’s moving] at such a pace that if you do not do this…you will perish. You will not be there. The people around you will move on. Consumers are expecting all sorts of improvements. It’s about how our lives have changed.

“Our business has to move at the pace that others are doing. I’m finding that a lot of people pay lip service to it, but that’s not doing it.”

Clark’s warning that adopting modern technological improvements is an imperative echo remarks made by IATA director general and CEO Alexandre de Juniac when speaking at the event.

“The airlines which will not have properly integrated digital revolution in their day-to-day business will die, because they will not be able to offer the customer, the passenger, a tailored and customized offer.”

Clark doesn’t characterize this adopt or perish reality as wholly negative. Instead, he sees opportunities.

“It gives us not problems but riddles that we have to solve.”

While many have focused on front-end improvements, and Clark agrees there is a benefit to those, he believes that improvements to operational systems are critical foundations to overall digital and data management innovations.

“The way you go about assembling the resources, and how you do back of house systems, are going to be completely transformed by digital.”

He also suggested that, where possible, airlines are better off handling those operational initiatives in-house, with opportunities to outsource the customer-facing platforms:

“Many businesses are going after customer facing innovation because that is the low hanging fruit and possibly delivers the value a lot quicker…Deconstructing the company IT systems and reconstructing the digital platforms in which the new processes will sit is fundamentally different. So back of house will lead us to do a better job front of house, consumer-facing, where we know there are many software houses and start-ups.

“What we want to do is look at how we actually run our processes, and then deliver [consumer-facing] through data analytics – once we’ve got the new processes in place – to see how we can better construct the kind of product that we want to do.

“And then we’ll be able to do all sorts of things with passengers other than just deconstruct and reconstruct an un-bundled and bundled environment. I’ll be able to do a lot more because I’ll know more about you and what you like and don’t like and pass that through all systems.”

Related reading from tnooz:
Getting the measure of digital transformation (June17)
A deep dive into digital transformation and innovation (May17)
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Marisa Garcia

About the Writer :: Marisa Garcia

Marisa Garcia is the tnooz aviation analyst. She has covered travel technology, design, branding, and strategy for leading publications, including Aircraft Interiors International Magazine, APEX Magazine, AirlineTrends, and Travel+Leisure. She also shares industry insights on her site Flight Chic. Fly with her on Twitter.



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